CK Hutchison shelves telco unit listing to focus on asset sales, sources say
CK Hutchison's Strategic Shift in Telecoms and Asset Management
By Amy-Jo Crowley, Kane Wu and Clare Jim
Abandoning the Global Telecoms Listing Plan
HONG KONG/LONDON, May 15 (Reuters) - Hong Kong conglomerate CK Hutchison Holdings is unlikely to move ahead with plans to list its global telecoms business, and will focus instead on selling individual assets, three people with knowledge of the matter said.
The company had been weighing listing the business in London and Hong Kong as soon as the third quarter, after spinning it off from the group, Reuters reported in January.
That is now unlikely to happen in the near term after CK Hutchison decided to sell its 49% stake in a British joint venture with Vodafone last week, one of the biggest pieces of its global telco business, the sources said.
CK Hutchison did not respond to a request for comment.
Challenge of Including UK Asset
Asset Sales as a Preferred Option
The conglomerate founded by billionaire Li Ka-shing had been simultaneously exploring sales of those telco assets in different markets and opted for that option as it made financial sense, the sources said.
Market Volatility and Loss-Making Units
A listing of the telco business which included the Three UK asset, which was loss-making as of 2024, would have been challenging in today's volatile market, two of the sources said.
Listing and Merger Considerations
Potential Venues and Valuation
CK Hutchison had been eyeing London as a primary listing venue and Hong Kong as a secondary venue for its telecoms businesses in Europe, Hong Kong and Southeast Asia that could be valued at around $20 billion, Reuters reported previously.
Exploring Mergers in Italy
The group was also exploring merging its Italian telecom unit Wind Tre with the Italian operations of French telecoms group Iliad, Reuters reported in October.
Advisors and Bank Involvement
The group tapped Goldman Sachs, Citigroup and Deutsche Bank to work on the listing option and Morgan Stanley to explore asset sales, Reuters reported.
GS, Deutsche Bank and Citi declined to comment. Morgan Stanley did not respond to a request for comment.
Focus on Enhancing Group Returns
Major Ports Business Sale
CK Hutchison has been focusing on enhancing the group's returns. Last year it announced a deal to sell most of its global ports business, including assets near the Panama Canal, for an equity value of $22.8 billion to a BlackRock-led consortium.
Regulatory Challenges
That sale has been progressing slowly due to complex regulatory clearance and China's request to include a Chinese investor in the buyer group.
Reporting Credits
(Reporting by Kane Wu and Clare Jim in Hong Kong; Amy-Jo Crowley in London and Elvira Pollina in Milan. Editing by Anousha Sakoui and Andrew Heavens)
